Marketing Metrics That Matter

Pardot Marketing Metrics That Matter Page 1

A Pardot White Paper

MARKETING METRICS
THAT MATTER
Introduction

Chapter 1
Email Marketing Renaissance

Chapter 2
Social Media State of Affairs

Chapter 3
Paid Search Landscape

Chapter 4
(Re)emergence of Display

Guide to Metrics that Matter

Conclusion

TM

www.pardot.com / 404.492.6845 / ©2012 Pardot, LLC / All rights reserved worldwide
marketing automation


Introduction
VANITY METRICS VS. BETTER METRICS

Marketers are under ever-increasing pressure to prove the value of their campaigns. With the
emergence of new channels like social media, marketers often don’t know which metrics to
focus on and how to properly attribute results. This forces marketers to pursue metrics that
don’t actually impact their bottom line, instead of the metrics that truly matter. These kinds
of “vanity metrics” seem substantial at ﬁrst glance, but upon deeper analysis, usually do not
correlate with sales success.

Today’s marketing analytics are powerful. Marketers now have access to all kinds of metrics,
from page views and number of fans to more revealing statistics involving leads and sales. With
the growing transparency in marketing data, it’s easy to get caught up in data that – more often
than not – is not actually impacting your revenue.

It is important to distinguish between these two types of metrics. Vanity metrics can be useful
for some purposes, including gauging brand awareness, optimizing marketing channels, and
tracking marketing reach. Better metrics are more closely tied to your bottom line and ROI. Lets
take a look at a few more differences:

TIED TO PERFORMANCE TIED TO REVENUE
Vanity metrics show you how a Better metrics show you exactly how
marketing channel is performing, but your marketing is performing in relation
not necessarily in terms of revenue. to your bottom line.

EASY TO TRACK HARDER TO TRACK
Vanity metrics are often the “out of Better metrics can be more difﬁcult to
the box” statistics available from most track, but provide far more insight than
analytics platforms. vanity metrics.

HELP WITH OPTIMIZATION HELP WITH SPEND EFFICIENCY
Vanity metrics can help you increase Better metrics allow you to accurately
your marketing reach, audience, and tie marketing activities to the revenue
campaign impact. each channel generates.

This white paper will explore the common vanity metrics for the major marketing channels as
well as some improved metrics that you should be tracking.
TM



Chapter 1
EMAIL MARKETING RENAISSANCE

Despite all of the recent attention given to social media, email remains the workhorse of
most online marketers. As one of the oldest online marketing tools, email has continued to
evolve alongside the new technologies that surround it. Email marketers now have access to
more data than ever and are able to focus on relevancy, segmentation, and deliverability with
signiﬁcant accuracy.

EMAIL MARKETING METRICS

With so much available data, many marketers lose sight of the metrics that matter most. Let’s
take a look at the vanity metrics common to email marketing and the better metrics that can
supplement them.

VANITY EMAIL METRICS

Deliverability Rate: if your emails are not getting through to your prospects, this
will be revealed in your deliverability rate. A high deliverability rate means your list
is clean – or that you don’t have many bad email addresses on it.

Open Rate: although open rate was once the only metric used to measure
the success of an email marketing campaign, it is an unreliable and innacurate
measurement for success. When emails are viewed in text only format, as they
are on devices like Blackberries, opens are not recorded while false opens are
often recorded in email clients with preview panels.

Share Stats: forwards and recommendations are great talking points that let
you know that you’ve created a compelling message. However, shares that
don’t result in new sales or lead opportunities cannot be tied to ROI.

TM



BETTER METRICS
Email’s vanity metrics are those that can’t be tied directly to ROI and sales numbers.
Conversion-related metrics are those that are trackable, measurable, and where your attention
should be focused.

CTA Completion Rate: your form’s completion rate gives you insight into your
campaign’s strengths and weaknesses. A low completion rate might mean your
content isn’t persuasive enough, your list isn’t targeted properly, or even that
your form is too long for prospects. The number of actual leads your campaign
drives is a metric that truly matters.

Acquisition Rate: the percentage of your leads that turn into actual sales is one
of your most important metrics. Driving a high number of leads that aren’t sales-
worthy might mean your lead quality is low, or that your marketing message isn’t
ﬁne-tuned enough to attract the type of leads that will convert for you.

Site Conversion Rate: this refers to how many of your prospects close your
email, but then return to your site at a future date and convert at that moment.
A seemingly unsuccessful email campaign might actually drive leads post-email,
so it’s important to have deep tracking in place. Fortunately, Pardot allows you
to track all of your interactions with your prospects so you can see when they
convert and how they interacted with your various marketing campaigns.

CPA (Cost Per Acquisition): knowing the cost of acquiring a new customer
is very useful. It lets you know how much you can afford to spend on your
marketing and sales initiatives while still being able to reach your target ROI.
Your CPA can be diluted by tactics that overlap, so it’s important to track and
attribute properly so you can get a true CPA.

TM



Chapter 2
SOCIAL MEDIA STATE OF AFFAIRS

Social media is all the rage these days, and it’s easy to see why. Facebook, Twitter, LinkedIn,
and YouTube provide access to audiences of millions, allow companies to form relationships
with their customers, and produce customer insights in volumes that marketers would have
never thought possible. While nearly everyone agrees that social media is valuable, tracking
and proving true ROI still remains a challenge.

SOCIAL MEDIA METRICS

Social selling is a different user experience than other sales funnels, making it notoriously hard
to track return on investment. Since social media first began to rise in popularity, the number
one complaint from skeptical business owners has been the questionable return on investment.

This ambiguity in effectiveness is not a result of the social channel, but a result of tracking the
wrong metrics. Below are a list of the common vanity metrics used to measure social media,
as well as a list of better metrics that will provide more insight into the financial performance of
your social marketing.

VANITY METRICS

Number of Posts: Many marketers make the incorrect assumption that
more social posts means more exposure. The key isn’t to constantly spit out
content and inundate your followers. You should be releasing useful content
on a scheduled basis so that your followers feel like they’re getting something
valuable from you.

Re-tweets: Re-tweets do have a stronger tie to the amount of exposure your
posts are receiving, but tell you little about their performance in terms of your
marketing goals.

Number of Friends/Followers/Subscribers: Think of quality over quantity.
Huge numbers are largely unimportant if you aren’t being followed by key
influencers in your space. Many of your folowers will never become leads or
share your message with your target audience.

TM



BETTER METRICS

Number of High Quality Leads: While social media is great for engagement,
the metrics that matter are the ones that measure the number of leads you are
generating. Tying your social media campaigns to the leads they generate will
give you and accurate look at how your campaign is performing.

Lead Conversion to Sales: a number just as important as the number of leads
your social media campaigns are generating is the percent of those leads that
become customers and drive revenue.

Purchasing Behaviors: do your Facebook fans purchase your products more
frequently? Do they upgrade, subscribe for longer periods, spend more time on
your website? These are all telling signs that your social media campaigns are
giving you results.

Referrals: are your social media campaigns sending new business your way?
Ideally, your social media fans would be driving additional leads and sales for
your company and serving as your brand evangelists.

TIPS FOR TRACKING SOCIAL
Custom Redirects: Impressions are often tracked by brands that can
afford to spend millions on paid search. They refer to the .

Promoted Tweets: Promoted tweets not only put your message in front
of more people, but also allows you to track exposure and engagement.

Closed-Loop Reporting: Closed-loop reporting services allow you to
tie each sale to their original point of entry, which may have been a social
post.

TM



Chapter 3
PAID SEARCH LANDSCAPE

Paid search campaigns have experienced many advancements in tracking. They are extremely
versatile and can be used to run both branding and cost-per-acquisition campaigns. The
flexibility of the major paid search engine platforms means you can optimize underperforming
campaigns almost instantly in order to improve your ROI.

PAID SEARCH METRICS

A lot has been written about paid search metrics and how measurable they are. Depending
on the type of campaign, you may want to weigh different factors more heavily. For most small
and medium sized businesses SMBs), increasing awareness is not the primary goal of a paid
search campaign because it’s inefficient for their revenue goals. Most SMBs use paid search to
drive leads and sales.

VANITY METRICS

IMP (Impressions): Impressions are often tracked by brands that can afford to
spend millions on paid search. They refer to the total number of people that are
exposed to your ads. Impressions can’t be directly tied to leads and sales.

POS (Position): Advertising agencies love to tout the position of your paid
search ad as a success metric. A top 3 position is usually exponentially
more expensive than a position in the 4-6 spot, and often generates a lot of
unqualified clicks. A slightly lower position is more economical.

Clicks: clicks speak to your ad’s position and its relevancy. If more people
are clicking on your ad, that usually means your ad is positioned well and is
resonating with viewers. However, if the people clicking on your ad are not your
target customers and are just unqualified traffic, then you are simply wasting
marketing dollars.

CPC (Cost Per Click): your cost per click is important to be mindful of, but it
should not be a defining metric for your paid search campaigns. For SMBs,
especially B2Bs with long sales cycles and a high cost per lead, a high CPC is
almost expected.
TM



BETTER METRICS

Leads: you should be focusing on the number and quality of leads generated
by your paid search campaigns. If your paid search budgets are tapped out,
focus on trimming the fat and optimizing your paid search campaigns. Get rid of
keywords that don’t result in leads, and tweak your landing pages and ad copy
to focus on what you want. One great way to prevent unqualified clicks is by
including a price point in your paid search ad.

CPL (Cost Per Lead): your cost per lead is a telling metric. Once you develop
your own target CPL, you can map your paid search campaigns to that goal
and optimize based on that larger metric. You’ll save precious bandwidth by
focusing on your larger, overriding CPL goals and not on smaller, micro-goals
like your CPC.

CPA (Cost Per Acquisition): your cost per acquisition tells you how much it
actually costs to acquire a new customer. It may only cost you $10 to generate
a paid search lead, but once you pass those leads on to your sales team and
have them dedicate their resources to closing a deal, it may cost you over $500
to acquire a new customer. With your CPA metric, you can back out all of your
other success metrics to determine what they should be and optimize your
entire paid search efforts around that goal.

TIPS FOR PREVENTING UNQUALIFIED CLICKS
A/B Test: The surest way to prevent unqualified clicks is to test different
layouts, copy, and offers to determine which elements perform best.

Include Price Points: Including price points in your ad will help deter
clicks from viewers who may not be interested in purchasing.

Tweak Keywords: Certain keywords are more likely to attract unqualified
buyers. Continually assess keyword effectiveness to cut down on
unqualified clicks.

TM



Chapter 4
(RE)EMERGENCE OF DISPLAY

Over the last few years, the display advertising landscape has been revitalized, largely due to
changes in the competitive landscape, better bid models, and improved targeting capabilities.
Of course, on the heels of this improved technology came the advent of smarter analytics (and
marketers!) that helped shift the display landscape to one of proper attribution.

DISPLAY METRICS
Historically, display had been used as a branding and awareness tool, largely supported by
agencies and companies with large marketing budgets. The emergence of retargeting and the
ability to measure metrics more applicable to SMBs has made it possible to track more useful
metrics that can be accurately tied to ROI. Below is a list of traditional vanity metrics for display
advertising and some better metrics that can now be tracked through analytics.

VANITY METRICS

IMP (Impressions): the high volume of impressions and the resulting brand
recognition were the biggest selling points for the traditional display model. As
we now know, however, display ads didn’t drive response the way other more
effective online tactics did. Impressions are irrelevant if the trafﬁc is unqualiﬁed
and doesn’t eventually result in leads or sales.

CTR (Click Through Rate): although clicks are desirable, accidental clicks and
high bounce rates make click through rates unreliable metrics for tracking the
success of an ad.

CPM (Cost Per Mille): the old pricing model for display ads was simply a cost
for 1,000 impressions, or a CPM. In the past, this was the only pricing model
that publishers were willing to entertain, because they knew they would never
be able to justify a CPC or CPL model because the numbers would never back
out from an ROI perspective.

TM



BETTER METRICS

CTL (Click to Lead): instead of focusing on a CPC metric, marketers should
focus on the number of people clicking on an ad that eventually become leads.
That allows for better ad targeting and optimization, and better end results.
After all, shouldn’t we be more interested in bottom line numbers like leads and
sales?

CPL (Cost Per Lead): fortunately, there are pricing models now that focus on
CPC or an estimated CPL, helping marketers justify display campaigns and
properly attribute and track results.

CPA (Cost Per Acquisition): like any marketer driven by CPA goals, you
should also focus on CPA numbers for your display campaigns. While branding
exercises are cool, if they aren’t resulting in reportable success metrics, they
shouldn’t be your focus.

TIPS FOR SUCCESSFUL ADS
Clear Call-to-Action: Making your call to action clear and concise will
help viewers to better understand what you would like them to do.

Simple Design: The simplier your design, the easier it is for viewers to
understand what you are asking for and what you are offering.

Value Proposition: Offering something of value in your ad, whether that
is a white paper or special promotion, will help motivate viewers to take
action and click on your ad.

TM


MARKETING METRICS THAT MATTER

Marketers have access to more metrics than ever before. That’s why it is
more important than ever to track the metrics that matter most.
= Vanity Metric = Better Metric

Bounce Sharing Open Deliverability
Rate Stats Rate Rate
EMAIL
METRICS +
Site
Acquisition Conversion Cost Per Form
Rate Rate Acquisition Conversions

4
Re-tweets/ Friends/ Number of
Shares Followers Posts
SOCIAL
METRICS 4
Number Closed Purchasing
Deals Referrals
of Leads Behavior

Click
Impressions Ad Through Cost Per
Position Click
PAID SEARCH Rate

METRICS 4
Number Cost Per $ Cost Per
of Leads Lead Acquisition

Click
$
Cost Per
Impressions Through
Impression
Rate
DISPLAY
METRICS Click To Cost Per Cost Per
$
Lead Lead Acquisition

TM



Chapter 5
CONCLUSION

It’s easy to get lost in the hype surrounding vanity metrics. After all, they often make you look
good! Information about tactics like social media and wide-reaching branding metrics can give
us interesting data points about our target customer, our brand evangelists, and the overall
breadth of our company.

However, these numbers don’t tell the entire story, and in fact, can vcause us to lose focus on
the metrics that truly matter – the ones impacting our company’s bottom line. So remember
your vanity metrics, but manage your campaigns using better metrics – the ones that matter.

PARDOT IS A MARKETING
AUTOMATION COMPANY.
Founded in 2007, we are located in
Atlanta, GA and focus on providing
hassle free automation solutions for
small to medium sized business in the
B2B space.

CONNECT WITH US
Pardot’s Website
Pardot’s Twitter
404.492.6845

TM


Marketing Metrics That Matter

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